Shared Equity Programs

In a CLT, a low- to moderate-income borrower can purchase a home on land leased through a municipality or nonprofit at affordable ground rent rates. The ground lease will typically require that the home can only be purchased by a low- to moderate-income family when resold.

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A resale restriction places a condition on the resale of a property. It can restrict resale based on a range of factors, from age to employment. Affordability-focused restrictions, focused on a borrower’s income or the price of the home, preserve accessible homeownership and fall under the shared equity umbrella.

Grounded Solutions Network, which previously created the CLT Network Model Ground Lease, has released a Model Declaration of Affordability Covenants with Refinance and Resale Restriction and Purchase Option (sometimes referred to as the Model Deed Restriction), that incorporates many shared equity best practices for income-restricted properties and may be useful to your shared equity partners. Learn more about the Model Deed Restriction at GroundedSolutions.org.

In a limited equity cooperative, residents own shares in a cooperative housing corporation that  can be resold at prices that ensure continued affordability and allow for modest equity growth.

Homes in these communities may be eligible for Fannie Mae financing via the Project Eligibility Review Service (PERS). See Fannie Mae Selling Guide section B4-2.2-06, Project Eligibility Review Service (PERS), for eligibility requirements.